Today NXP Semiconductor (NXPI) Hits New Lifetime High

Trade-Ideas LLC identified NXP Semiconductor (NXPI) as a new lifetime high candidate

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified NXP Semiconductor ( NXPI) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified NXP Semiconductor as such a stock due to the following factors:

NXPI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $175.0 million.

NXP Semiconductors N.V. provides mixed signal and standard product solutions for radio frequency (RF), analog, power management, interface, security, and digital processing products worldwide. It provides integrated circuits (ICs) and discrete semiconductors. NXPI has a PE ratio of 17.1. Currently there are 10 analysts that rate NXP Semiconductor a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for NXP Semiconductor has been 3.4 million shares per day over the past 30 days. NXP Semiconductor has a market cap of $13.8 billion and is part of the technology sector and electronics industry. Shares are up 21.7% year-to-date as of the close of trading on Monday.

TheStreet Quant Ratings rates NXP Semiconductor as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity and impressive record of earnings per share growth. However, as a counter to these strengths, we find that the company has favored debt over equity in the management of its balance sheet.

Highlights from the ratings report include:

The revenue growth came in higher than the industry average of 5.0%. Since the same quarter one year prior, revenues rose by 15.9%. Growth in the company's revenue appears to have helped boost the earnings per share.

NXP SEMICONDUCTORS NV reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, NXP SEMICONDUCTORS NV turned its bottom line around by earning $1.34 versus -$0.48 in the prior year. This year, the market expects an improvement in earnings ($4.19 versus $1.34).

The gross profit margin for NXP SEMICONDUCTORS NV is rather high; currently it is at 55.92%. Regardless of NXPI's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, NXPI's net profit margin of 7.42% is significantly lower than the industry average.

Powered by its strong earnings growth of 178.72% and other important driving factors, this stock has surged by 75.23% over the past year, outperforming the rise in the S&P 500 Index during the same period. Looking ahead, however, we cannot assume that the stock's past performance is going to drive future results. Quite to the contrary, its sharp appreciation over the last year is one of the factors that should prompt investors to seek better opportunities elsewhere.

The debt-to-equity ratio is very high at 2.55 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Even though the debt-to-equity ratio is weak, NXPI's quick ratio is somewhat strong at 1.02, demonstrating the ability to handle short-term liquidity needs.